Vertica’s Oracle compatibility wins over data warehouse customers

Column-based database start-up Vertica Systems Inc.’s strategy of trying to supplement rather than usurp customers’ data warehouses appears to be paying off.

The Billerica, Mass.-based company, which began selling its software just a year and a half ago, brought in US$20 million in revenue in the past four quarters, said Dave Menninger, vice president of marketing, last week.

Vertica announced the release of Version 2.5 of its namesake database just half a year after the release of Version 2.0 in March.

Version 2.5 adds features such as the ability to design data warehouses in a number of schemas, and enhancements to SQL — especially compatibility with Oracle’s version of SQL. That will make it easier for customers to port existing applications written for their Oracle databases or data warehouses over to Vertica, Menninger said. Version 2.5 also adds custom data partitioning, hot backup and an intelligent query router so that applications can automatically search for data whether it is located inside the Vertica data mart or the main enterprise data warehouse.

The company has 50 customers, including a financial services firm that Vertica signed up last month. That customer is Vertica’s largest to date, Menninger said, though he declined to name the firm.

Vertica’s bread-and-butter is what the company calls a “teramart,” a specially built high-speed data mart that is an adjunct to the main data warehouse and analyzes a certain segment of data, typically multiple terabytes in size.

Many of its customers are in the telecom or financial markets, and competition is heating up. Oracle Corp., Microsoft Corp. and Teradata Inc. all have announced major new BI-focused upgrades in the past month or so.

Customers can buy Vertica one of three ways. Most simply, they can license the database to run on Linux servers. A small number buy the software preinstalled on server appliances built by Hewlett-Packard Co. or Sun Microsystems Inc. Licensing the database or buying it on an appliance both cost the same: about $100,000 per terabyte of user data, Menninger said.

That means a teramart of only 10TB costs $1 million. That figure appears expensive compared with Vertica’s competitors’ offerings in the large and high-performance business intelligence market. Netezza Inc. reportedly charges about $29,000 per terabyte, while GreenPlum Inc. charges about $20,000 per terabyte of user data.

But Menninger said he doesn’t expect the company to have to respond with price cuts. Vertica is “saving customers money,” he said. “Despite the fact that the economy is struggling, our business has been accelerating.”

Price-sensitive customers can opt for a third option introduced in May: running a Web-hosted version of Vertica from’s EC2. That option starts at $500 per month for 500GB of data.

Vertica has no plans to create its own set of BI analysis and reporting tools. “Our goal is to use standard interfaces to hook in as well as possible with existing products in the market,” Menninger said.

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